Homebuilder confidence rose in October, the second consecutive month of gains, despite ongoing supply chain bottlenecks as the pandemic continued to stymie deliveries.
The University of Michigan’s preliminary consumer sentiment index unexpectedly dropped to 71.4, the second-lowest reading since 2011, a report on Friday showed.
“Consumers feel it’s a bad time to buy a home but a good time to sell – and they continue to cite high home prices as the primary reason,” said Doug Duncan.
Home loan rates are rising as inflation remains stubbornly high and bond investors react to the Federal Reserve’s plan to begin tapering its purchases of Treasuries and mortgage-backed securities.
The Fed said it could begin reducing its asset purchases as early as next month, according to minutes released on Wednesday.
Core inflation, known as the Fed’s preferred gauge because it excludes volatile food and energy prices, was flat in September. The overall inflation reading rose to a 13-year high.
The volume of applications for mortgages to purchase homes increased last week while refinancings declined, according to data from the Mortgage Bankers Association.
The number of days required to close a mortgage shrank in August to the shortest period in over a year, according to ICE Mortgage Technology.
About 4.2% of all mortgages in the nation were in some stage of delinquency, meaning 30 days or more past due, including loans in forbearance, the report said.
The U.S. economy added 194,000 jobs in September, the slowest pace in more than a year, according to the Bureau of Labor Statistics.
